INVO Bioscience, Inc. (INVO)·Q2 2024 Earnings Summary

Executive Summary

• Record Q2 revenue of $1.84M, up 481% year-over-year and 17% sequential; clinic revenue rose 611% to $1.81M, with adjusted EBITDA improving by $1.1M YoY to $(0.51)M .
• Sequential growth across Middleton, Atlanta, and Birmingham fertility centers with management stating they are collectively profitable and reiterating the goal to reach breakeven on current operations .
• Operating expenses increased to $3.74M driven by a $1.0M one-time non-cash item and $0.2M higher amortization; Q2 also included ~$25K in merger-related costs with NAYA .
• Merger timeline remains uncertain: INVO and NAYA are negotiating a further extension to the definitive merger agreement given prior amendments and ongoing interim funding discussions .

What Went Well and What Went Wrong

What Went Well

• Revenue inflection: Total revenue up 481% YoY to $1,836,597; clinic revenue up 611% to $1,807,921, with consolidated and equity-method clinic revenue totaling $2,141,229 (+201% YoY) .
• EBITDA trajectory: Adjusted EBITDA improved by $1.1M YoY to $(509,623), with CEO highlighting the path to breakeven and profitability on current operations .
• Operational execution: “Our fertility centers in Middleton, Atlanta, and Birmingham are all experiencing sequential revenue growth and are collectively profitable,” underscoring clinic-level profitability and execution .

What Went Wrong

• Operating cost pressure: Total operating expenses rose to $3.74M (+$1.3M YoY), driven by a $1.0M one-time non-cash expense and higher amortization, partially offset by modest merger-related costs (~$25K) .
• Bottom line remained negative: Net loss was $(2,245,170), roughly flat YoY versus $(2,240,511), indicating revenue growth has not yet translated into net profitability .
• Strategic uncertainty: The NAYA merger requires further extension discussions; prior amendments largely extended target closing and interim funding requirements, adding timeline uncertainty .

Financial Results

Revenue, EPS, Profitability vs Prior Periods and Prior Year

Notes: Wall Street consensus (S&P Global) was unavailable for INVO; estimate comparisons are not provided.

Segment/Source Breakdown

Operating Cost and Operating Loss

Guidance Changes

INVO did not issue formal numerical guidance ranges in Q2 2024. Management reiterated the breakeven/profitability objective on current operations and indicated plans to resume acquisitions and new INVO Center openings in 2025.

Earnings Call Themes & Trends

No Q2 2024 earnings call transcript was found in our document set; themes below reflect quarter-to-quarter management commentary in press releases.

Management Commentary

• “We report record second quarter revenue – up 481% year-over-year and 17% sequentially – with a $1.1 million improvement in adjusted EBITDA. Our fertility centers in Middleton, Atlanta, and Birmingham are all experiencing sequential revenue growth and are collectively profitable.” — Steve Shum, CEO .
• “This growth and clinic-level profit, coupled with our careful management of overall corporate expenses, positions us to achieve our stated goal of reaching breakeven with our current operations.” — Steve Shum, CEO .
• “To accelerate our path to profitability, we also expect to resume both our acquisition and new INVO Center activities in 2025.” — Steve Shum, CEO .
• Q1 framing: “Strategic initiatives…to capture a greater share of total fertility cycle revenue and profit…are starting to bear fruit.” — Steve Shum, CEO .
• FY23 context: “We continue to execute on our plan to capture a greater share of the total fertility cycle revenue and profit through the transformation of INVO into an innovative healthcare services company.” — Steve Shum, CEO .

Q&A Highlights

No Q2 2024 earnings call transcript was available; therefore, no Q&A highlights or guidance clarifications can be provided from a call in this period.

Estimates Context

• Wall Street consensus (S&P Global) for Q2 2024 EPS and revenue was unavailable for INVO via our system; as a result, estimate comparisons and beat/miss analysis are not included.
• Given the scale of the revenue inflection and adjusted EBITDA improvement, sell-side models may need to reflect higher clinic throughput and consolidated clinic profitability, while incorporating Q2’s one-time non-cash OpEx and amortization effects .

Key Takeaways for Investors

• Revenue momentum is robust and broad-based across clinics, with consolidated clinic operations driving a 481% YoY revenue increase and sequential growth of 17% in Q2 .
• Adjusted EBITDA improved by $1.1M YoY to $(0.51)M, indicating operating leverage from higher clinic volumes, though further scale is needed to cross breakeven .
• Operating costs rose on a one-time non-cash charge and amortization; monitoring OpEx normalization and recurring run-rate is key for near-term profitability trajectory .
• Management reiterated breakeven on current operations and expects to resume acquisitions and new center openings in 2025—potential medium-term catalysts for growth and margin expansion .
• NAYA merger timing remains uncertain; further extensions are under discussion, creating a strategic overhang to consider in position sizing and risk management .
• Without formal numeric guidance or available sell-side consensus, investors should anchor on disclosed quarterly trends (revenue, adjusted EBITDA, clinic performance) and watch for subsequent filings/updates .
• Near-term trading: momentum from record revenue and improving EBITDA could be supportive; watch for updates on merger timeline, OpEx normalization, and any additional clinic-level disclosures to sustain sentiment .